A306 FINAL Exam 2026|2027 Advanced Practice Questions and
Answers with Complete A+ Solutions 100% Correct!!!
Payback period= - Correct Answer -Initial investment/annual net cash flows
Advantages of top down approach (2) - Correct Answer -1. Time savings
2. Reduces super star syndrome
Disadvantages of top down (2) - Correct Answer -1. Overlook day 2 day underperformance
2. Morale
advantages of bottom up (3): - Correct Answer -1. Ownership
2. Team motivation
3. Accuracy
Disadvantages of bottom up: - Correct Answer -Super star syndrome
1|Page
,Advantages of RI (2) - Correct Answer -1. Avoids underinvestment problem in ROI
2. Conceptually leads to better project selection for the company
Disadvantages of RI (1) - Correct Answer -1. Size sensitive ; favors larger divisions because
they have larger RI)
Advantages of a balanced scorecard (4) - Correct Answer -1. Means to implement strategy
2. Means to achieve an organizational change in strategy
3. Can be used to determine compensation & rewards (motivate managers to pursue one
course of action vs another)
4. Top management is committed
Disadvantages of balanced scorecard (3): - Correct Answer -1. Non financial info is
subjective
2. Must be adaptable and frequently updated
3. Costly and time consuming to implement
2|Page
,Is the cost traceable to a specific cost object? - Correct Answer -Yes! Direct cost
Is the cost traceable to a specific cost object? - Correct Answer -No! Indirect cost
Manufacturing costs - Correct Answer -DL, DM, MOH
Non manufacturing costs - Correct Answer -Selling, gen, and admin costs
Traditional income statements are organized by - Correct Answer -Cost function
CM statement are organized by - Correct Answer -Cost behavior
Excess deficiency - Correct Answer -BB + INFLOWS - OUTFLOWS
RI = - Correct Answer -NOI - (RRR x average op assets @ NBV)
3|Page
, How do variable costs respond in total with activity level? - Correct Answer -Inc/dec
relative to activity level
How do variable costs respond per unit with activity level? - Correct Answer -CONSTANT
How do fixed costs respond in total with activity level? - Correct Answer -CONSTANT
How do fixed costs respond in per unit with activity level? - Correct Answer -Dec as activity
level increases and increases while activity level falls
When NPV is positive, will IRR be higher or lower than the cost of capital? - Correct Answer -
Higher
What are used to separate mixed costs out of given data - Correct Answer -1. Hi lo analysis
2. Regression
4|Page
Answers with Complete A+ Solutions 100% Correct!!!
Payback period= - Correct Answer -Initial investment/annual net cash flows
Advantages of top down approach (2) - Correct Answer -1. Time savings
2. Reduces super star syndrome
Disadvantages of top down (2) - Correct Answer -1. Overlook day 2 day underperformance
2. Morale
advantages of bottom up (3): - Correct Answer -1. Ownership
2. Team motivation
3. Accuracy
Disadvantages of bottom up: - Correct Answer -Super star syndrome
1|Page
,Advantages of RI (2) - Correct Answer -1. Avoids underinvestment problem in ROI
2. Conceptually leads to better project selection for the company
Disadvantages of RI (1) - Correct Answer -1. Size sensitive ; favors larger divisions because
they have larger RI)
Advantages of a balanced scorecard (4) - Correct Answer -1. Means to implement strategy
2. Means to achieve an organizational change in strategy
3. Can be used to determine compensation & rewards (motivate managers to pursue one
course of action vs another)
4. Top management is committed
Disadvantages of balanced scorecard (3): - Correct Answer -1. Non financial info is
subjective
2. Must be adaptable and frequently updated
3. Costly and time consuming to implement
2|Page
,Is the cost traceable to a specific cost object? - Correct Answer -Yes! Direct cost
Is the cost traceable to a specific cost object? - Correct Answer -No! Indirect cost
Manufacturing costs - Correct Answer -DL, DM, MOH
Non manufacturing costs - Correct Answer -Selling, gen, and admin costs
Traditional income statements are organized by - Correct Answer -Cost function
CM statement are organized by - Correct Answer -Cost behavior
Excess deficiency - Correct Answer -BB + INFLOWS - OUTFLOWS
RI = - Correct Answer -NOI - (RRR x average op assets @ NBV)
3|Page
, How do variable costs respond in total with activity level? - Correct Answer -Inc/dec
relative to activity level
How do variable costs respond per unit with activity level? - Correct Answer -CONSTANT
How do fixed costs respond in total with activity level? - Correct Answer -CONSTANT
How do fixed costs respond in per unit with activity level? - Correct Answer -Dec as activity
level increases and increases while activity level falls
When NPV is positive, will IRR be higher or lower than the cost of capital? - Correct Answer -
Higher
What are used to separate mixed costs out of given data - Correct Answer -1. Hi lo analysis
2. Regression
4|Page
